In his first few months in office, Gov. Chris Christie has proven he is no shrinking violet. Breaking new ground on everything from affordable housing to school funding, the governor has shown that he is not afraid to trot out big, bold ideas in an attempt to heal the long festering wound that has been infecting New Jersey’s fiscal health.

And so it is without trepidation or hesitation that I recommend yet another ambitious concept that not only can save us hundreds of millions of taxpayer dollars, but can improve the health of our state work force.

As a lawyer, lobbyist and insurance company executive, I have learned a thing or two about how the health industry, and the health insurance industry specifically, work. These lessons can be applied to work miracles for New Jersey’s taxpayers and for its workers as well.

Currently, the state provides health care coverage for its 800,000-plus public employees and retirees. The state is what is known in the industry as "self-funded." This means the state pays for medical claims out of its own funds, rather than contracting with an insurance company to take on the risk associated with the medical care costs of public employees. When public workers and retirees get sick, they go to the doctors’ offices, labs and hospitals, and the state pays the bills. The system is administered at additional significant costs by private vendors.

While this system has worked to afford adequate health benefits for public sector employees and retirees, it has failed miserably on three counts: First, it requires the state of New Jersey to set aside huge reserves — in the hundreds of millions of dollars — to pay claims and to protect itself against possible future increases in claims. Second, the state does not have the expertise and wherewithal to implement wellness and prevention programs that would save precious dollars. Third, the benefits under the current state program are much richer than most private employers offer — and are etched in statute.

The state should take its "book of business" — those 800,000 or so "covered lives" — and put it out to bid with a requirement that whoever wins implement chronic disease prevention and wellness programs. Once an insurance company assumes the coverage, the state would be free to use the funds it now has in reserve — some $500 million — for the state budget.

Millions more could be saved over time by changing laws to bring state benefits in line with those provided in the commercial world and by requiring the state’s insurance vendors to do a much better job at disease management, wellness and transparency.

A competitive bidding process among qualified insurers will assure the state gets a good price for public sector coverage. As the former chairman of the New Jersey Association of Health Plans, I know that insurers currently doing business in the state will most certainly compete for this business.

States across the nation are struggling to balance their books. Many of them are turning to public employee and retiree health benefits for answers. Most of them, however, are only taking small steps at addressing costs.

In Delaware, the governor has proposed eliminating coverage for one of the partners of couples who both work for the state. Idaho is forcing its Medicare-eligible retirees into private plans.

Indiana is ending a "bridge plan" that helped retirees get from retirement to Medicare eligibility. Nebraska is going to try a wellness plan on its own.

These ideas may yield savings, but they all fall short of the kind of bold and creative concept for which our new governor has already become known. I say, go for the big enchilada and "privatize" state health benefits. The fiscal and physical well-being of our state and its workers will be better off for it.

Brian Litten is president and CEO of the Litten Group in Moorestown. He is a former senior executive at AmeriHealth and Horizon Blue Cross Blue Shield of New Jersey and served in the administration of Gov. Christie Whitman.